MICRO 13-17

Which of the following is not an example of price discrimination?

An icecream parlor charges a higher price for ice-cream than sherbet

Which of the following is correct?

Assuming that implicit costs are positive, accounting profit is greater than economic profit.

Which of the following is not an example of price discrimination by a firm?

a natural gas company charging customers a higher rate in the winter than in the summer

When a single firm can supply a product to an entire market at a lower cost than could two or more firms, the industry is called a

natural monopoly

In a perfectly competitive market

no one seller can influence the price of the product

The story of a prisoners' dilemma shows why

oligopolies can fail to cooperate, even when cooperation is in their best interest.

A firm cannot price discrimination if it

operates in a competetive market.

For a monopolistically competitive firm, at the profit-maximizing quantity of output

price exceeds marginal costs

imperfectly competitive firms are characterized by

price making ability

Which of the following expressions is correct?

Accounting profit= total revenue-explicit costs

Which of the following statements is not correct?

Both monopolies and monopolistically competitive firms can earn economic profits in the long run.

Which of the following is not a reason for the existence of a monopoly?

Diseconomies of scale

Which of the following is not a characteristic of a competitive market?

Entry is limited

Which of the following is not a characteristic of a monopoly?

One buyer

Which of the following conditions is characteristic of a monopolistically competitive firm in both the short-run and the long run?

P> MC

To maximize its profit, a monopolist would choose which of the following outcomes?

Q=30 and P=60

Foregone investment opportunities are an example of

an implicit cost

The value of a business owner's time is an example of

an opportunity cost

Fixed costs can be defined as costs that

are incurred even if nothing is produced

A monopolistically competitive market has characteristics that are similar to

both a monopoly and a competitive firm

The lower the concentration ratio, the

more competitive the industry

In a two-person repeated game, a tit-for-tat strategy starts with

cooperation and then each player mimics the other player's last move

In an oligopoly each firm knows that its profits

depend on both how much output it produces and how much output its rival firms produce.

A firm's opportunity costs of production are equal to its

explicit costs + implicit costs

Which of the following is a characteristic of monopolistic competition?

free entry

A benefit of a monopoly is

greater creativity by authors who can copyright their novels

A production function describes

how a firm turns inputs into output

in general, game theory is the study of

how people behave in strategic situations

A particular cable TV company requires a household to subscribe to its high-speed internet service if it subscribes to cable TV, and vice versa. This practice

is referred to as tying, is regarded by some economists as a form of price discrimination, is controversial among con omits because they disagree on whether it has adverse effects for society as a whole.

A monopolist produces

less than the socially efficient quantity of output but at a higher price than in a competitive market

If firms are competitive and profit maximizing, the price of a good equals the

marginal cost of production

When a firm's only variable input is labor, then the slope of the production function measures the

marginal product of labor

The deadweight loss that arises from a monopoly is a consequence of the fact that the monopoly

quantity is lower than the socially-optimal quantity

Price discrimination is the business practice of

selling the same good at different prices to difference customers

Price discrimination requires the firm to

separate customers according to their willingness to pay

The long-run supply curve for a competitive industry may be upward sloping if

some resources are available only in limited quantities

Which of the following may eliminate some or all of the efficiency that results from monopoly pricing?

the government can regulate the monopoly

An example of an opportunity cost that is also an implicit cost is

the value of the business owner's time

The paradoxical nature of oligopoly can be demonstrated by the fact that, even though the monopoly outcome is best for the oligopolists,

they have incentives to increase production above the monopoly outcome.

Which of the following can be added to profit to obtain total revenue?

total cost

Economic profit

will never exceed accounting profit